Why do banks still keep gold?
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Because people still value gold.
If nobody cares about your shiny metal, you get rid of it. (You’d actually sell it to where it’s useful, like electronics boards.) But it seems people do care, so you keep it.
They believe it’s a hedge against uncertainty in the dollar. I.e. if the dollar crashed gold would be extremely valuable.
Gold is what used to back money. $1 was a certain amount of gold and the bank had to have that gold to back the money they loaned. Now the gold standard has been dropped but without that supply of gold, the banks wouldn’t actually own anything.
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